Insurance Pricing Of Vegetable Price Index Based On Insured Expectation

In agricultural production and management,farmers' incomes are not only facing natural risks,but also facing market risks.With the support of technological progress and traditional agricultural insurance,the natural risks faced by farmers can be guaranteed to a certain extent,but the market risks faced by farmers are less secure.Market risk and natural risk also affect the income level of farmers,and also affect the stability of agricultural products market.In recent years,the market risks faced by agricultural products market have become more and more serious,and the prices of agricultural products in many agricultural products markets in China have experienced severe fluctuations.According to the cobweb model,farmers will decide the next-stage output according to the price of agricultural products in the previous period.The violent fluctuation of agricultural product prices will cause confusion in the production decisions of farmers,seriously interfere with the output of agricultural products,directly affect the income level of farmers,and also cause bad consumption and social welfare of citizens.influences.In order to prevent increasingly significant market risks,innovative agricultural insurance-agricultural price index insurance came into being.Under the mutual support of insurance companies and the government,China has started pilot agricultural product price index insurance since 2011,providing pigs,The price of agricultural products such as vegetables and fruits is the price index insurance product of the insurance subject.Agricultural product price index insurance provides farmers with price risk protection and maintains the stability of the crop market.Due to the particularity of agricultural product price index insurance in terms of insurance subject matter and insurance claims,there is a large risk in actual operation.From the market point of view,since the insurance target of agricultural price index insurance is the market index,it has higher systemic risk than the traditional agriculture whose insurance target is the individual of the farmer.With the reform and development of China's market economic system,the degree of market integration is getting higher and higher,and systemic risks are becoming more serious.Since China's agricultural product price index insurance is in its infancy and lacks corresponding experience,data and methods,it often faces huge compensation risks in the operation of agricultural product price index insurance,which directly affects the normal operation of insurance companies.From an individual point of view,in the actual operation of agricultural product price index insurance,because the insurance target is not the individual income of the farmer but the selected price index,the income of the farmer is not related to the insurance payment,and the agricultural product price index insurance has a large basis risk..Farmers no longer make insurance decisions based on their own income levels but based on their own predictions of market trends,and there is a large risk of adverse selection.Farmers are expected to affect farmers' insurance policy,and adverse selection risk is a problem that agricultural product price index insurance products have to consider.In behavioral economics theory,it is believed that investors will have irrational expected behavior when making investment decisions.This irrational behavior also exists in insurance decision making.In order to solve the systemic risk and adverse selection problems in agricultural product price index insurance,this paper takes the vegetable price index insurance as an example,draws on the investor sentiment model to analyze the farmers' expectations,and fully considers the irrational behavior of the farmers when they apply for insurance.Under the condition of different vegetable price changes,farmers' different insurance policy decisions are estimated.Using numerical simulation method,a price index insurance pricing model that takes farmers' reverse selection behavior into account is obtained.This paper selects the most comprehensive and accurate Shouguang vegetable price index as empirical data,and uses the pricing method of this paper to price the vegetable price index insurance,and the insurance premium rate is similar to the empirical rate.The pricing model can estimate the probability of insurance insured by farmers under different price changes and reasonably estimate the future loss of the insurance company.It provides a risk reference basis for insurance companies in the price index insurance operation,and also provides reasonable management advice for the relevant agricultural departments and the government.